4 reasons why investing in SIP is a good decision

Systematic Investment Plans (SIPs) have become one of the most sought-after methods of investing in mutual funds. An SIP allows an investor to invest a certain sum of money periodically in a mutual fund for a specific period. It operates similar to a recurring deposit.

However, unlike RDs which are debt instruments, SIPs are linked to mutual funds, and therefore, the market performance.

If you are thinking how much should be invested through SIPs, experts suggest to stay invested for a longer period.

“Also, it is essential that you do not miss your investment commitments. You must not attempt to invest more than what you know you can spare after your liabilities and essential expenses are covered,” said Ajit Narasimhan, Category Head – Savings & Investment, BankBazaar.

Narasimhan said investing in mutual funds through an SIP offers investors better risk-adjusted returns.

Here are 4 reasons why SIPs are a good deal